We created HUD.loans, Inc., to make it easier for our clients to utilize FHA multifamily financing, the industry’s lowest-cost source of non-recourse, fixed-rate multifamily loans. Our team of expert HUD multifamily mortgage bankers and advisors provides one-on-one advisory services and brokers HUD multifamily loans for our clients. We put our customers first by cutting timelines and reducing complexity in order to make FHA multifamily financing more available to consumers.

We’re proud for HUD.Loans, Inc. to be part of our parent company, Janover Ventures. Combining our expertise in capital markets, direct investments, digital media, and technology, Janover Ventures is democratizing the multifamily, commercial, and residential real estate lending industries— complex spaces that are often misunderstood, even by those who work in them every day. At Janover Ventures, our team is committed to staying at the cutting edge of real estate by combining our deep industry knowledge with state-of-the art technology and an unparalleled dedication to our clients.

We hire the best people, track the latest technologies (building them where they don’t exist), and work tirelessly to overachieve on behalf of our clients.

Yes, HUD 223(a)(7) loans typically allow prepayment. However, there is often a 0-2 year lockout period, during which the loan cannot be prepaid at all, followed by an 8-10% declining prepayment penalty. This means that the prepayment penalty will decline by 1% each year, starting after the lockout period ends.

Just like other HUD multifamily loans, HUD 223(a)(7) loans are fully assumable subject to FHA approval and a fee of 0.05% of the original FHA-insured loan amount. The fact that these loans are assumable can be a significant benefit to borrowers; especially those who want to sell their property after a few years. This is because having a new borrower assume the loan prevents the previous borrower from having to pay a prepayment penalty.

In general, the HUD 223(a)(7) loan program does not allow for cash out refinancing. Instead, the 223(a)(7) loan can only finance certain eligible costs, including 100% of the property’s existing mortgage, third-party reports, minor/moderate property repairs, replacement reserves, prepayment penalties (if the borrower is paying off their HUD multifamily loan early), and certain other costs. Borrowers who wish to get cash out from a multifamily property may wish to look towards other types of financing, such as a CMBS loan.

HUD 223(a)(7) loans require a HUD application fee (0.3% of the loan amount) which is due at application. Half of this is refunded after closing. Other fees and costs for the HUD 223(a)(7) program are usually capped at 2.0%.

Without a doubt, the HUD 223(a)(7) loan process is faster and has fewer hoops than other FHA/HUD products. The streamlined, affordable process does not require new third-party reports like appraisals, market studies, or environmental reports. In fact, most 223(a)(7) refinances only require a project capital needs assessment (PCNA).

The HUD 223(a)(7) refinance loan program can reduce interest rates, increase amortization, and improve cash flow while reducing the cost of debt service. It can even absorb prepayment penalty costs. On top of all that, it is one of the fastest, easiest, and most affordable multifamily or healthcare loans that you can get.